Thank you, Madame Executive Secretary Songwe for that generous
introduction. It is an honor to be here at the United Nations Economic
Commission for Africa (UNECA). I want to thank the Ethiopian government for
welcoming me to Addis Ababa.

It has been an excellent visit so far. Yesterday morning, in fact, I
visited the Eastern industrial park.

It was fascinating to see how technology of all kinds needs public
involvement and good public-private sector partnerships to succeed. There
is a direct link between roads, education and health systems and
innovation.

It is a powerful reminder that technological innovation requires a strong
foundation to flourish.

This is what I would like to speak about today: The impact of technology
for the economies of Africa and the new opportunities being created for the
next generation.

Why do I talk about the next generation?

Because historic demographic changes require us - all of us - to focus on
youth and assess the impact of these changes. This is a moment where young
people can take their destinies into their own hands.

In fact, youth in Africa already comprise 75 percent of the working age
population.
[1]
By 2030, over half of new workers entering the global labor force will come
from Africa.
[2]

With the right strategy, the demographic dividend can bring prosperity.
This incredible surge could translate into a virtuous cycle of economic
growth and development.

Clearly technology does not hold all the answers. In fact, technology often
raises new questions, including about the impact of automation.

But there is no doubt that technology is an important part of the story.

And being here at UNECA, it is impossible not to think about Africa’s
story.

The famous artist, Afewerk Tekle, created the beautiful stained glass
windows that are part of UNECA’s headquarters. His three-piece installation
is titled “Africa Then,” “Africa Then and Now,” and “Africa Now and in the
Future.”

Technology is already shaping “Africa Now.” And with the right investments,
it can be a powerful tool to help build stronger economies for “Africa in
the Future.”

Outlook

Let me start by offering a brief overview of the economic context for the
application of new technologies and home-grown innovation in Africa.

Globally, the sun is shining through the clouds and helping most economies
generate the strongest growth since the financial crisis. The IMF is
projecting 3.6 percent growth for 2017 and 3.7 percent for 2018.

Looking at the continent of Africa, the recovery is strengthening in many
countries. Growth is expected to reach 2.9 percent in 2017 and 3.5 percent
in 2018 and 2019.

This topline number masks significant variations among countries. While
nearly one-third of nations are growing at around 5 percent, others —
particularly the commodity exporters — are seeing a slowdown due to lower
commodity prices.

On a GDP per capita basis, 15 countries on the continent are expected to
see a decline this year. This encompasses about 40 percent of the
population.

And there are concerns on the horizon as well, even as the sun is shining.
Indeed, as I have been saying recently, it is
when the sun is shining that we have to fix the roof.
One concern we see is a sharp increase in public debt, which has reached 50
percent of GDP in nearly half of sub-Saharan Africa’s countries. This is a
big cloud on the horizon.

How can we find a way to achieve lasting growth that is stronger and more
inclusive, so that people across Africa benefit and see higher living
standards?

It is not the only answer. Each country will have to find the right policy
mix.

And again, harnessing the promise of technology is another way we can
accelerate economic and social development.

2. The Right Environment for Technological Innovation

Too often, we see the endgame of innovation. A drone that delivers medical
supplies in the Rwandan countryside, saving resources and more importantly
saving lives. Or a social network for farmers in Uganda that creates an
online forum for sharing crop information.

We tend to overlook the conditions that helped foster innovation and
allowed it to grow.

Consider financial integration, where new technology has expanded access to
credit across Africa.

One of the prime examples is banking. In 2015, nearly 35 percent of the
adult population in sub-Sahara Africa had a mobile money account, the
highest percentage in the world.
[3]

While Kenya is a leader in mobile banking, other countries are catching up.
In Côte d’Ivoire, Somalia, Tanzania, Uganda, and Zimbabwe, and many others.
People are now more likely to have a mobile account in these countries than
a traditional bank account.
[4]

What does it mean to have banking through your phone? Well, it may mean the
difference between being approved for a loan or not. Or it may mean that
someone who is losing his or her job can more easily face the hardship
because friends and family can send money quickly.

In short, it can mean the difference between being empowered and being
marginalized.

As more citizens access credit and achieve basic economic security,
opportunities develop, aspirations grow, and a brighter future comes within
reach. It also a critical factor in order to improve trust. Mobile banking
can help eliminate the middle man and create more confidence throughout
society.

The same is true when it comes to infrastructure investment.

Perhaps the greatest obstacle to the development of manufacturing in Africa
is the lack of sufficient and reliable electricity.

Hundreds of millions of people on the continent live without access to
power on any given day.
[5]

Solar energy is one tool that is making a difference. In the last few
years, tens of thousands of people in Ghana and Tanzania have been brought
online thanks to new solar businesses. M-kopa, a Kenyan energy company,
sells solar panels to rural homes for a small deposit, with the remainder
paid off over the course of a year through mobile banking.

The system has brought electricity to over half a million homes — helping
remote areas come online while extending credit to those who need it the
most.

Energy investment is a focus throughout Africa.

In Burkina Faso, in Zambia, in Benin, new solar stations are already in
development.

In Morocco, construction is underway on a facility that will become one of
the largest solar power plants in the world.

These projects will help Africa close its infrastructure gap, which is
estimated to be over $90 billion annually.
[6]
And they are most likely to succeed when the public and private sector work
together.

That is one of the reasons that the IMF is supporting the Compact with
Africa, a joint project between the G20 and seven African nations so far,
which is designed to boost private sector investment and create jobs.

When it comes to jobs, it is the foundational elements, including access to
credit, good infrastructure, education and training that so often form a
springboard for even more innovation.

With these elements in place, a true world of opportunity can open up.

In October at our Annual Meetings, I was excited to meet the head of a
company called Andela that considers Africa “home to the largest untapped
talent pool” and is training and matching African workers to help U.S.
companies fill shortages in tech jobs such as programming.

Just recently, a group of young entrepreneurs in Togo, who were supported
by a community innovation lab, developed the first 3-D printer made
entirely of electronic waste. They saw a problem in their city — digital
junkyards full of cell phones and laptops discarded from other parts of the
world — and they had an idea.

They would turn that waste into a powerful machine. Now they plan to put
3-D printers in every school within a kilometer of the lab, in the hopes of
sparking students’ imagination and creating a lifelong interest in
technology.
[7]

None of this would have been possible if those young inventors had not been
given the skills and resources to pursue their passion.

This is where governments can make a difference.

Not only by creating a foundation for innovation, but also by streamlining
regulations so that everyone plays by the same rules and entrepreneurs are
rewarded for their ingenuity. It is not the only thing that governments can
do.

From my point of view having spent twenty-five years of my life in the
private sector, I have seen the ways governments can ensure that there is
access to markets and more competition. This is what creates more
innovation and more productivity.

And not only can governments do more to encourage innovation, they
can also help lead the way themselves by supporting basic
research.

3. How Governments Can Leverage Digital Tools

IMF analysis in our recently published book, Digital Revolutions in Public Finance, shows that across the
developing world, countries could save around one percent of GDP by
updating their government payment systems from cash to digital. In some
places in Africa the potential is even higher.
[8]

In Nigeria, for example, we estimate that a government move to digital
payments could save between 5 to 9 billion U.S. dollars, or about 1.7
percent of GDP.
[9]

When governments put technology into practice millions of people can be
helped. Think of Sierra Leone. During the Ebola outbreak, some emergency
responders had to leave their patients for days to go and collect payments
from a regional office.

By introducing a mobile wallet system, the government was able to save
lives and better allocate resources where they were needed the most.

The possibilities go beyond paychecks. Between 2011 and 2014, the Ministry
of Education in Cote D’Ivoire shifted all tuition payments from cash to
digital. The result was fewer lost fees, less fraud, and new investments in
the school system.

In Ghana, a pilot program of a new blockchain platform called bitland is
being used to record land sales.
[10]
In the future, land disputes may be easily and more quickly settled out of
court.

So this is not just about saving money, it is also about creating more
transparency, promoting stronger accountability, and in the end, delivering
a better life for every citizen.

We are already seeing the positive impact of technology today for
government services, private transactions, and the way we live our lives.

The potential to help reduce corruption, increase revenues, and generate
investments in health and education means digital tools could be a decisive
factor in meeting the 2030 Sustainable Development Goals.
The voice of the IMF will be part of that process.

The IMF is committed to working with all of our members in Africa, as well
as our regional and international partners, to help reach these goals. And
to help meet the economic goals for the entire continent.

To get there, we will need a little creative thinking.

4. How the IMF is Helping Members Harness Technology

Let me give you an example of where creativity can make a difference. Last
year, the IMF and the Senegalese Ministry of Finance organized a
“hackathon” in Dakar to find ways to improve the government’s tax
collection system. 100 young entrepreneurs came to share their ideas.

The winning proposals showcased the potential when governments embrace
technology. From an application that allows people to file taxes without
internet access, to a software system that simplifies thousands of pages of
documents, to a website that gives citizens better access to their own tax
information.

This is just one example of how we serve our membership by helping to
improve economic conditions and strengthen institutions.

In fact, in 2016, sub-Saharan Africa was the largest recipient of our
capacity development efforts. And when we see something that works, we can
help promote best practices and knowledge-sharing across countries and
across continents.

Our six capacity development centers across Africa allow us to respond
quickly to countries’ emerging needs.

And we continue to innovate through our free online courses, which have
already trained nearly 30,000 individuals worldwide, including many right
here in Africa. These courses qualify officials in public financial
management, debt sustainability analysis and so many other topics.

Not every one of these programs has a technology focus, but each initiative
is designed to secure the economic foundations of our members. And where
there is a strong foundation, technology, as well as all types of
innovation, can flourish.

5. Conclusion

Let me conclude by drawing upon the wisdom of a friend and leader who has
inspired so many in Africa — and all over the world — President Ellen
Johnson Sirleaf.

She once said, “The size of your dreams must always exceed your current
capacity to achieve them. If your dreams do not scare you, they are not big
enough.”

When I travel in Africa, I never worry that the dreams of the next
generation are not big enough. They are.

The only question is how can we help create the environment where those
dreams will have a chance to come true.

Diversification of economies is one way. Harnessing technology is another.

We can do it, there is a path to do it, and it is called cooperation.

Cooperation between public and private sectors, cooperation between people,
and cooperation between multilateral institutions such as the IMF and
UNECA.

The IMF looks forward to continuing to be your partner in this journey.